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CA Intermediate · Corporate and Other Laws · Companies Incorporated Outside India

Nordic Steel AS, a foreign company with a place of business in Chennai, has not yet filed its balance sheet and the other documents required annually. Which statement correctly states the legal position under the Companies Act, 2013 regarding its financial statements?

Nordic Steel AS must prepare its balance sheet, profit and loss account and the required documents each year, as prescribed for foreign companies, and deliver copies to the Registrar. Being incorporated abroad gives no exemption, and filing with the RBI does not replace this duty.

  1. AIt need not file any accounts because it is not incorporated in India
  2. BIt must prepare and file with the Registrar a copy of its balance sheet and profit and loss account, with documents, as per the Act, in the manner prescribed for foreign companiesCorrect
  3. CIt must file accounts only if it has Indian subsidiaries
  4. DIt need only send accounts to the Reserve Bank of India

Explanation

Section 381 requires every foreign company to prepare, in respect of each financial year, the financial statements and other documents as if it were an Indian company, and deliver copies to the Registrar. The Act does not exempt it merely for being foreign or restrict this to those with Indian subsidiaries. Sending accounts to the RBI does not replace the Registrar filing.

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